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Steve Ballmer: Azure “Has a Lot of Work to Do” as Amazon Maintains Cloud Lead

In an interview with CNBC, former Microsoft CEO Steve Ballmer said Microsoft faces challenges to compete with Amazon Web Services, but Azure is moving in the right direction. He also briefly discussed the success of the Surface hardware brand.


Isn't it obvious is back in the tech area? A couple of days after launching his USAFacts website, the former CEO is making his presence felt. Naturally, the state of Microsoft is a hot topic question for Ballmer as he promotes his website. Talking about Azure, he says Microsoft has “a lot of work to do”.

Since current CEO Satya Nadella replaced Steve Ballmer, Microsoft has embraced a cloud first ethos. The Azure cloud platform has been the driving force behind the company's recovery and recent success.

Still, Azure is still trailing Amazon Web Services (AWS) by some margin. The deficit is closing, but AWS is the leading cloud platform. Speaking to CNBC, Ballmer touched on Azure and said Microsoft has no predetermined right to be a success in the cloud.

Let's be clear from the start, Ballmer gets a lot of stick from a lot of people. However, he is not saying Azure sucks. Instead he is simply being real in saying the platform is not the market leader. He does also believe that Microsoft is in an advantageous position to take on Amazon Web Services.

“I think the company is well-positioned, on the other hand (there is) a lot of work to do…I think that on the cloud side with Office 365 and Azure, the company's got a real shot but not a birthright,” Ballmer tells CNBC. “They are going to have to push very hard with Azure versus Amazon Web Services… With Amazon Web Services, Azure is the challenger, it has only one way to go, which is up. With Office 365 there is more upside than downside, and that's a risk.”

His assertions about Azure are not too far off. Microsoft has positioned itself well to take the fight to AWS, yet Amazon is also thriving in the could market. Then, of course, there is Google. Mountain View is third placed as a cloud provider, but is chasing both Microsoft and Amazon.

While both Microsoft and Google are moving in the right direction, it may not be quick enough to overtake Amazon, at least not in the near future.

The RightScale 2017 State of the Cloud Report provides an interesting glimpse into the state of the cloud service market. It shows that 57 percent of surveyed customers are still using AWS services. Interestingly, this is the same figure as last year.

Microsoft's Azure is being used by 34 percent of respondents, a sizeable increase from 20 percent in 2016. has also enjoyed growth year-on-year, from 10 percent to 15 percent.

Juggling the math is headache inducing, but it's worth a try. If Amazon has stayed the same and both Microsoft and Google have increased share, it means more customers have adopted the cloud. It also suggests that Azure's best chance of growth comes from appealing to new customers and not trying to steal Amazon's.

Pleased with Surface

Ballmer's biggest legacy at Microsoft is arguably Surface. As CEO, he attempted to steer the company to become a hardware brand, based on mobile and tablets. Think v2.0 and you get the idea.

The vision did not turn into a reality as Microsoft's hardware floundered and the company hit a dark period. Ballmer ultimately left, with the Surface division hardly thriving. Since then, it seems the idea to have a hybrid machine that is both tablet and laptop was a good one. The Surface division enjoys solid growth through each quarter.

Steve Ballmer says he is “most pleased” with Surface and added that the brand has “progressed nicely”.

Luke Jones
Luke Jones
Luke has been writing about all things tech for more than five years. He is following Microsoft closely to bring you the latest news about Windows, Office, Azure, Skype, HoloLens and all the rest of their products.

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